What is meant by Aggregate Demand ? State its component.
Solution:
Aggregate demand is the total demand of goods and services in an economy. Components of aggregate demand :
(i) Private consumption expenditure
(ii) Investment expenditure
(iii) Government expenditure
(iv) Net export (Export -Import)
Aggregate demand is the total demand of goods and services in an economy. Components of aggregate demand :
(i) Private consumption expenditure
(ii) Investment expenditure
(iii) Government expenditure
(iv) Net export (Export -Import)